China Three Gorges Corporation (CTGC), the developer of the West Seti Hydropower Project located in far western Nepal, has proposed a downward revision of its installed capacity.

During a tripartite meeting held between CTGC, the Investment Board Nepal (IBN) and the Nepal Electricity Authority (NEA) on Thursday, the Chinese company suggested lowering the project’s capacity from the original 750 to 600 MW. 

CTGC officials gave a presentation to update the IBN and NEA on the study they had carried out, according to a highly placed IBN source. “They advised making a downward revision citing a drop in the water level in the river,” said the source. “We are yet to give our official version in this regard.”

The Chinese company’s proposal is based on a recently concluded feasibility study of the scheme. The reservoir-type West Seti project, which will be spread over Baitadi, Bajhang, Dadeldhura and Doti districts, is being built at a cost of $1.6 billion.

If the installed capacity is revised downward, the project may generate less electricity than previously expected.

IBN CEO Maha Prasad Adhikari and NEA Managing Director Kulman Ghising lead their respective organizations at the meeting. CTGC officials also inquired about the transmission line to evacuate the electricity generated by the project and Nepal’s consumption capacity.

“They expressed doubts about our capacity to consume the energy generated by the project and the infrastructure to distribute it,” said the source. “We assured them that the power would be consumed within the country and also that the transmission line would be ready by the time the project is completed.”

The visiting officials from CTGC are scheduled to start negotiations with the NEA to form a joint venture (JV) company to develop the project. “JV negotiations will start on Friday,” said the source. “The officials will remain in Kathmandu till Monday. We are hopeful that the JV deal will be concluded by then.” 

The government had turned the project over to CTGC subsidiary CWE Investment Corporation

in August 2012 after signing

a memorandum of understanding.

As per the accord, the Chinese company will have a 75 percent stake in the project with the NEA holding the rest. The IBN has been struggling to conclude the JV deal between the Chinese company and the NEA.

CTGC officials had also

visited Nepal last March and laid the groundwork for the agreement, but the talks ended without making much headway.